Federal Reserve Criticizes Custodia Bank for Endangering the Crypto Industry and Its Own Stability
The Federal Reserve has issued an 86-page document criticizing Custodia Bank's approach to the crypto industry, justifying its January 2023 rejection of the bank's bid to become a member of the Federal Reserve System. The document cites significant risks surrounding Custodia's business model and insufficient risk management systems, raising concerns about Custodia's managerial, financial, corporate powers, and convenience and needs factors. Custodia had filed a lawsuit against the Fed in June 2022 over its master account application, which is still pending.
Other Countries Eager to Fill the Vacuum Left by the US
Daniel Seifert, Coinbase's Vice President in Europe, has argued that the United States' regulatory approach to cryptocurrency has created an environment of uncertainty and instability, leaving a void that other countries are eager to fill. Seifert claims that progressive regulation in France, the UK and the European Union are contributing to the creation of vibrant crypto ecosystems. In contrast, the U.S. government has pursued "regulation by enforcement" rather than comprehensive regulation, leading to a lack of regulatory clarity in the industry.
Annual Report by White House Council of Economic Advisers Criticizes Crypto Industry
The Council of Economic Advisers (CEA) dedicated a chapter in its annual report to digital assets, where it argued that the crypto industry's goal to operate outside of government regulations is a recipe for disaster. The report highlighted that the industry is repeating the same mistakes that led to past financial crises. Many in the crypto industry found the assessment concerning, given the current regulatory environment.
G7 Nations to Advocate Stricter Regulations for Cryptocurrencies
The G7 nations are planning to promote more stringent regulations for the cryptocurrency industry to enhance transparency and consumer protections. Officials revealed that the discussions would be accelerated, with the goal of finalizing proposals for the G7 finance ministers and central bankers' meeting in May. This meeting will take place just before Japan's Prime Minister hosts the 2022 G7 summit in Hiroshima.
Disclaimer: The information provided in this section is for informational purposes only, doesn't represent any investment advice or FameEX's official view.